An Arizona group, the Goldwater Institute, has filed a lawsuit on behalf of the owner of a Portland vape shop, alleging that state rules covering the packaging for vaping liquids violate the Oregon Constitution.
The lawsuit, filed Tuesday in Multnomah County Circuit Court on behalf of Paul Bates, the owner of Division Vapor, located at 2929 Southeast Powell Blvd., is seeking to block the Oregon Health Authority from enforcing administrative rules that prohibit the use of certain images and words the state thinks would be attractive to juveniles.
The Oregon Constitution's free speech clause (Article I, Section 8) is famously broad. It says "no law shall be passed restraining the free expression of opinion, or restricting the right to speak, write, or print freely."
The lawsuit says "this guarantee prohibits the government from mandating that businesses censor truthful, non-misleading speech about the products they sell."
As examples, the lawsuit notes that in 2016, state rules prohibited the labels on vaping liquids from depicting "celebrities, athletes, mascots, fictitious characters played by people, or other people likely to appeal to minors" and "food or beverages likely to appeal to minors such as candy, desserts, soda, food or beverages with sweet flavors including fruit or alcohol."
In 2018, the lawsuit says, OHA added additional labeling rules, prohibiting "terms or descriptive words for flavors that are likely to appeal to minors such as 'tart, tangy, sweet, cool, fire, ice, lit, spikes, poppin', juicy, candy, desserts, [and] soda."
The rules also forbid the use of images of fruit and other foods and specifically prohibit the use of words such as "apple," and "strawberry."
Bates, the Division Vapor owner, argues in the lawsuit the rules are moot for his store because nobody under 21 is allowed inside. He adds that what the lawsuit calls "censorship" is time-consuming and costly because his employees have to use white stickers and other means to obscure prohibited words and images on the bottles of vaping liquids.
The lawsuit seeks an injunction against the rules and unspecified damages. It comes at a time when the vaping industry is growing rapidly. That growth caused federal FDA commissioner Scott Gottlieb to refer to vaping among teens as an "epidemic" this summer.
But the growth also means big bucks. Juul Labs, a California start-up that has captured significant market share ,is reportedly in talks with Altria, the tobacco giant that makes Marlboro cigarettes among other brands. Altria's investment, should it happen at the terms being discussed, would value Juul at $25 billion to $30 billion, making it among the most valuable startups in Silicon Valley history.
The Oregon Department of Justice, which represents OHA, declined to comment on the lawsuit.